Duty drawback: All Industry Rates and brand rates

Updated 15 Oct 2026

This guide is for manufacturer and merchant exporters who use imported or duty-paid inputs. It explains how duty drawback works, how to claim the All Industry Rate on your shipping bill, when a brand rate makes sense, and why drawback payments get stuck or recovered.

What drawback refunds

Duty drawback, under Section 75 of the Customs Act, 1962 and the Customs and Central Excise Duties Drawback Rules, 2017, gives back customs duty paid on inputs used to make the goods you export (and central excise duty on certain inputs such as fuel that are still outside GST). It does not refund GST: that is handled through your LUT or the IGST refund route.

There are two ways to get it:

	All Industry Rate (AIR)	Brand rate
Who sets it	Government, in a schedule for the whole industry	Customs, for your specific product, on your application
Basis	Average duty incidence across the industry	Your actual duty paid, backed by documents
When used	Most exports	No AIR for the product, or AIR is less than 80% of duty you actually paid
Effort	Claimed on the shipping bill, paid automatically	Separate application with detailed data

The All Industry Rates schedule

The current schedule was notified by Notification 77/2023-Customs (N.T.) of 20 October 2023 and applies from 30 October 2023. It has since been amended for a few items, most recently gold and silver jewellery in July 2026 (Notification 64/2026-Customs (N.T.)). The schedule lists a drawback serial number (tariff item), a rate as a percentage of FOB value or an amount per unit, and in many cases a cap: the maximum amount per unit regardless of FOB value.

On the shipping bill, the drawback serial number is entered with a suffix. Suffix B is used for normal claims. Suffix D applies only to certain garments exported under the special Advance Authorisation for apparel. If the schedule shows no rate for your product, you cannot claim AIR and should look at a brand rate.

How to claim AIR and get paid

Register your bank account with customs. On ICEGATE, use the bank account management facility to register an export promotion incentive account linked to your IEC. Customs pays drawback directly into this account through the Public Financial Management System (PFMS).
Find the right drawback serial number. It follows the customs tariff but is not identical to the 8-digit HS code. Agree it with your customs broker before shipment.
Declare it on the shipping bill. Enter the serial number with the correct suffix for each item. Your broker also files the declarations the rules require, for example that inputs were not imported duty-free.
Answer queries promptly. After the let export order and the export general manifest, the claim is processed in the customs system. If an officer raises a query, it shows against your shipping bill on ICEGATE; the claim waits until you reply.
Track the payment. Once sanctioned, the claim moves to a scroll and is paid to your bank account. Check the status on ICEGATE. If it shows a PFMS or bank validation error, correct the account details.

Applying for a brand rate

A brand rate is fixed under Rule 6 (no AIR exists for the product, or the AIR is nil) or Rule 7 (the AIR is less than four-fifths of the duties you actually paid on inputs). You apply to the jurisdictional customs authority with the data customs asks for, typically:

the drawback statements showing inputs, quantities and duty paid;
import bills of entry and purchase invoices for the inputs;
a description of the manufacturing process and input-output consumption;
copies of the shipping bills for the exports covered.

The application must be filed within three months of the let export order. An Assistant or Deputy Commissioner can extend this by three months, and a Commissioner by a further six months, each against a fee. Customs has clarified that the fee is per application, not per shipping bill. Under Rule 7 you can usually be paid provisionally at the AIR while the brand rate is being decided. Your port's public notice will list the exact documents and format.

Drawback and RoDTEP together

Drawback and RoDTEP refund different things. Drawback covers customs duty on inputs; RoDTEP covers other taxes built into the product that no other scheme refunds. You can normally claim both on the same shipping bill, provided you declare both correctly. Apparel and made-ups get RoSCTL instead of RoDTEP, again alongside drawback. What you cannot do is claim AIR drawback on goods whose inputs were imported duty-free under Advance Authorisation, or on exports by EOU and SEZ units, which the AIR notification excludes.

Courier exports through the customs EDI system have been eligible for drawback since 12 September 2024, and electronic postal exports since 15 January 2026.

Why drawback is denied or recovered

Export proceeds not realised. Under Rule 18, if payment is not received within the time allowed under FEMA (including any extension your AD bank or RBI grants), customs will issue a notice to recover the drawback. One exception: where ECGC has paid a claim under its cover, RBI has written off the realisation requirement, and you produce a certificate from the Indian mission about non-recovery from the buyer.
Bank account problems. A closed account, an IFSC changed after a bank merger, or a name that does not match the IEC holder will cause the PFMS payment to fail. Keep your ICEGATE bank details current.
Wrong serial number or suffix. A mismatch between the drawback serial number and the goods leads to a query, a lower rate or later recovery.
Value conditions. The law bars drawback in certain cases, for example where the market price of the goods is below the drawback amount or the claim is too small. Customs can also deny drawback where the value declared looks inflated.
Missed brand rate deadlines. Late applications without an approved extension are rejected.

Watch out for

Keep import and purchase records for the inputs. Brand rate cases and audits depend on them.
Use the e-BRC and EDPMS data to show realisation; do not wait for a recovery notice.
Check the schedule for amendments before each new product or contract: rates and caps do change.

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Sources

Last checked 1 October 2026. Rules change: confirm with your customs broker or the drawback section at your port before you act.

Spotted something out of date? Tell us

Our guides are drafted with the help of AI and checked against official sources, but rules change often and mistakes can slip through. Please confirm with DGFT, CBIC, RBI, ECGC or your bank before you act. General information only, not legal or financial advice.